Lie: Jobs Options May Not Be Nefarious

Apple CEO Steve Jobs is being investigated for what could be an illegal backdated options grant. But backdating expert ERIK LIE, the University of Iowa professor whose research helped spark the recent scrutiny of options, says he's unconvinced the suspicious 2001 grant to Jobs is nefarious. Even though the facts of the grant fit the classic scenario for backdating, Lie points out that Apple could have picked a more lucrative day to set the price than Oct. 19. Lie says his research suggests backdated grants tend to be granted at the low end of V-shaped curves -- that is, after periods in which the underlying shares have declined in price, and before big run-ups. But on Oct. 19, Apple's shares had been on the rise for two weeks. While Apple shares did rise 20 percent from Oct. 19 through the end of that year, the pattern isn't all that striking compared to other grants, says Lie.